Bankruptcy and Insolvency Law

Information on Bill C-55

The Bankruptcy and Insolvency Act (BIA) provides a legislative framework for the liquidation of the assets of an insolvent individual, corporation or partnership, and the distribution of the proceeds in a fair and orderly way among the creditors. It provides for the appointment of a trustee to take charge of the assets, sell them and distribute the proceeds. Alternatively, the Act provides ways for insolvent businesses or consumer debtors to avoid bankruptcy by negotiating arrangements with their creditors for the compromise of their debts and the reorganization of their financial affairs.

Companies' Creditors Arrangement Act

The Companies' Creditors Arrangement Act (CCAA) provides a legislative framework for the reorganization of insolvent corporate debtors. It enables an insolvent company to seek a court order staying its creditors from taking action against it while it negotiates an arrangement with them for the rescheduling or compromise of its debts.

Winding-up and Restructuring Act

The Winding-up and Restructuring Act (WURA), jointly administered by Industry Canada and Finance, provides an alternative framework to the Bankruptcy and Insolvency Act for the liquidation and distribution of an insolvent corporation's assets among its creditors. It is the only legislative vehicle available for the liquidation of major financial institutions, including banks, insurance companies and trust and loan companies, none of which can be liquidated under the BIA.